Will FCC Net Neutrality Rules Survive Court?

Challenges to FCC rules will be heard by appeals court in D.C. ... and Verizon is licking its lips

Opponents of the Federal Communications Commission’s net neutrality rules won an important court victory last week, one that may eventually mean the death of the rules, a major setback for FCC chairman and net neutrality proponent Julius Genachowski, and a restriction of the power of the FCC itself.

On Thursday, a judicial panel chose to consolidate several challenges to the rules that have been filed with federal courts in the weeks since the rules were officially published in the Federal Register. More importantly, the panel randomly selected the U.S. Court of Appeals for the District of Columbia Circuit as the court that will hear the consolidated case. That’s the same court that last year shot down the FCC’s attempt to regulate Comcast’s Internet traffic, saying the FCC does not have statutory authority to regulate the Internet. “If you’re a telecom company, you were hoping for D.C.,” says Scott Flick, a partner with D.C.-based law firm Pillsbury Winthrop Shaw Pittman who deals with regulatory issues before the FCC.

Indeed, this is the outcome Verizon was hoping for when it filed its challenge, and with good reason. Lawyers in the field who spoke with Adweek think the venue will give Verizon an edge, as it will try to argue that this case is just a repeat of last year’s decision. “It’s always good to have judges who are familiar with the case,” says Rob Jackson, counsel for law firm Reed Smith. “The challenge for the government is to persuade the court this is a different case, resting on a different legal theory and different facts,” says Gerry Waldron, a partner with Covington & Burling. Jackson doesn’t think the FCC will be able to do that. “For years, the FCC didn’t regulate the Internet, and now they are almost imposing common carrier rules,” says Jackson. “Agencies have a lot of ability to regulate, but when they change direction, they have to have a reasoned explanation. I’m not sure the FCC explained itself.” Waldron disagrees. “I think it does get upheld,” he says. “The original decision by the D.C .Circuit set out a road map for how the FCC could write a rule…I think they followed the road map.”

The luck of the draw was good for Verizon, but the move to the D.C. Circuit wasn’t good news for other groups that filed challenges to the net neutrality rules, however. Liberal organizations like Free Press and Media Access Project—which support the idea of net neutrality generally but think the FCC’s rules are too weak and want them to be as tough on wireless as they are on wired—had filed in other districts, hoping to get judges more sympathetic to their point of view. They don’t want a court that might rule that the FCC lacks the power to impose any net neutrality rules at all. Now, though, that’s what they might get.